Photo: Guido ten Brink/SB-Medien
Donald Trump and Xi Jinping have yet to make peace on the matter of trade, and as they duke it out by enforcing import tariffs, it’s the third parties that suffer the most out of this affair. On this occasion, Volvo’s automotive division took the decision to reshuffle XC60 production in a clever way, bypassing the trade war altogether.
By shifting production of the mid-size SUV for the U.S. market to European specification from its assembly plant in Chengdu, China, the automaker avoids the wrath of Donald Trump over Chinese imports. On the other hand, the Torslanda plant in Sweden will focus production of the X60 for the United States of America.
Whichever way you look at it, Volvo made a fool out of both world leaders and their stupid war of attrition by import tariffs. As a brief refresher on the matter, Washington slapped 25-percent tariffs on $34 billion in Chinese imports, including passenger cars and utility vehicles such as the XC60 and S90 mid-size sedan. Beijing retaliated with tariffs of its own, and that is how a trade war unfolds.
Adding insult to injury, Volvo opened its first plant in the United States near Charleston in South Carolina, where the S60 is manufactured. If push comes to shove, any model line from the Swedish automaker’s 60 and 90 Series can be assembled at this facility. This worst case scenario could soon turn out true, with U.S. President Trump threatening tariffs against imports from the European Union.
Speaking to Automotive News, chief executive officer Hakan Samuelsson told the publication that the answer to this threat is to "ramp up Charleston as fast as we can." At the same time, Volvo is lobbying against the proposed tariffs because they would affect the industry as a whole.
If Trump goes forward with his plan, then the price of new cars imported from Europe could rise by $1,400 at the very least, even $7,000 in some cases. This, as you would expect, makes it harder for European automakers to compete with domestic products in the United States. Unless you’re Volvo and you have a factory here, that is.
Whichever way you look at it, Volvo made a fool out of both world leaders and their stupid war of attrition by import tariffs. As a brief refresher on the matter, Washington slapped 25-percent tariffs on $34 billion in Chinese imports, including passenger cars and utility vehicles such as the XC60 and S90 mid-size sedan. Beijing retaliated with tariffs of its own, and that is how a trade war unfolds.
Adding insult to injury, Volvo opened its first plant in the United States near Charleston in South Carolina, where the S60 is manufactured. If push comes to shove, any model line from the Swedish automaker’s 60 and 90 Series can be assembled at this facility. This worst case scenario could soon turn out true, with U.S. President Trump threatening tariffs against imports from the European Union.
Speaking to Automotive News, chief executive officer Hakan Samuelsson told the publication that the answer to this threat is to "ramp up Charleston as fast as we can." At the same time, Volvo is lobbying against the proposed tariffs because they would affect the industry as a whole.
If Trump goes forward with his plan, then the price of new cars imported from Europe could rise by $1,400 at the very least, even $7,000 in some cases. This, as you would expect, makes it harder for European automakers to compete with domestic products in the United States. Unless you’re Volvo and you have a factory here, that is.
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